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Internet of Things—Unlocking the Business Value of Connected Devices: Weekend Reading

What is the Internet of Things (IoT) and why is it important to businesses? To start, it is about the collection, analysis and use of unprecedented amounts of real-time data that likely will disrupt the way many organizations do business today. The Internet of Things (IoT) concept involves connecting machines, facilities, fleets, networks and even people to sensors and controls and then feeding the sensor data into advanced analytics applications and predictive algorithms as a way of enhancing automation and improving the maintenance and operation of machines and entire systems—and in some cases even enhancing human health.

As connected devices proliferate and networks penetrate into remote regions, the potential for IoT solutions and growth in the IoT ecosystem has increased. If IoT solutions can improve enterprise adopters’ fundamental business values—not just savings and risk management, but also revenue growth and innovation—demand and new uses for connected devices will grow. At a higher level, IoT has a role to play in helping companies create more sustained value through moving from a one-time transaction focus to a continuous, relationship focus with customers, suppliers, workers and assets.

The Internet of Things has the potential to offer business value that goes beyond operational cost savings. Providers in the IoT ecosystem have a largely unexplored opportunity to develop compelling IoT solutions that examine how the ability to collect and analyze disparate data, in real-time and across time, might transform the business. These developments will play out within and across enterprises, offering opportunities for sustained value creation and even disruption for those who can imagine possibilities beyond the incremental.

Organizations are still early in the adoption of the IoT. Yet, belief is widespread—among analysts, investors, IoT technology providers and enterprises large and small—that businesses are on the cusp of an explosion in the potential and adoption of IoT. Economic and technological barriers are receding, and with the proliferation of connected devices and evolving analytics capabilities, the possibilities for IoT seem boundless. Each industry will have its own use cases, some focused on businesses, some on consumers. Already, agriculture is experimenting with more efficient irrigation and soil monitoring, while manufacturing and process industries increasingly instrument and connect machinery and wearable applications developed in the wellness industry are migrating into health care.

But significant obstacles remain. Executives worried about security and interoperability are unsure of the economic rewards relative to the risks of implementing IoT solutions. Consumer-facing use cases, in particular, raise additional privacy and security concerns. IoT providers (of hardware infrastructure, software, communications and devices) have yet to articulate compelling propositions for how IoT solutions can drive lasting economic value for the enterprise.

Instead, many vendors focus on selling technology to the CIO—without a comprehensive vision of how it will translate into returns for the business. There is a largely unexplored opportunity for IoT providers who can broaden the sales horizon to encompass the CEO, CMO, CFO, compliance and risk officers and even major line managers. As machines and objects become more intelligent, armed with enhanced analytics, context awareness and predictive decision-making, they will be able to act in ways that benefit individuals and the larger system.

Read the full reportThe Internet of Things Ecosystem: Unlocking the Business Value of Connected Devices

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